Highly sophisticated nature of scams and the ongoing impacts of COVID-19 partly to blame for the growing number of victims
Data released by ASB showed a significant increase in Kiwis falling victim to scams since the COVID-19 pandemic began in March 2020.
Topping ASB’s list were investment scams, particularly those involving cryptocurrency, with the number of customers being tricked into responding to fraudulent money-making opportunities more than tripling between April 2020 and March 2022.
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The number of customers falling for romance scams in the past couple of years more than doubled, the bank’s data also showed.
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The pandemic also saw a growing number of ASB customers who fell victim to phishing (the sending of fraudulent emails to trick a person into sharing sensitive information) and smishing (a similar attack that relies on using SMS or text messaging). The biggest spike occurred between November 2020 and January 2021, when from the normal average of 100 per month, the number of impacted customers jumped to more than 1,000, after a smishing attack in which scammers posed as a postal agency.
Mark Emmett, ASB head of fraud operations, said more Kiwis are suffering a financial loss at the hands of scammers due to the highly sophisticated nature of scams and the ongoing impacts of COVID-19.
“We're seeing scams becoming very highly sophisticated, which makes them hard to spot, and it unfortunately means more Kiwis are being caught out,” Emmett said. “Falling for a scam certainly doesn't make you a fool. COVID has put people in situations where they are isolated from their support networks, and this can prevent them from getting a second opinion. Financial pressures brought on by COVID are also making people more susceptible to being deceived by scams offering opportunities to make money, so it's no surprise that we've seen these figures increase during the pandemic.”
Emmett said a lack of knowledge and awareness of cryptocurrencies was also contributing to more Kiwis getting duped.
“Cryptocurrency offers a new investment opportunity some Kiwis are keen to take advantage of. However, as there's still a lack of understanding around it, we're seeing more people being lured by investment scams rather than seeking advice from a registered financial advisor,” he said.
ASB also found the rise of more complex cold-call scams worrying, with the bank reporting double the number of customers being tricked by a scammer posing as a bank employee in the past 12 months.
ASB data showed that more than 70% of customers who had fallen victim to an investment, romance, or cold-calling scam during the pandemic were over the age of 50. Meanwhile, the average age of customers who fell victim to an investment scam was 58, to a romance scam, 60, and to cold calling, 77.
Emmett said Kiwis of all ages should be wary of being caught out by scammers.
“Scams impact customers of all ages, in fact we're seeing younger people regularly being caught out via social media,” he said. “It's typically our customers over the age of 50 who are more likely to report it, as they often suffer a larger financial loss. The difficult thing with these types of scams is that customers can make transactions without realising they are being scammed. It's important for Kiwis to look at these things with a dose of healthy scepticism, and if they have any doubts to get in touch with our fraud team via 0800 ASB FRAUD. ASB will never ask for your internet banking details over the phone or send you a text or an email with a link to log into FastNet Classic, nor will we ask you to send money to any unfamiliar accounts.”
To help protect customers from scams and fraud, ASB has recently introduced new authentication measures via its mobile app to prevent and notify customers of unauthorized logins to their FastNet Classic accounts.